"This is a significant boost for the Buncrana Road area of the city and is a really good news story for the entire north west region," he said.

"Not only will it help address the housing issue but it will also provide a much needed boost to the local economy in terms of construction jobs.

"This application is also in keeping with council's commitment to developing housing, regenerating and investment in this area of the city as outlined in our Strategic Growth Plan."

The application was made by Pragma Planning and Development Consultants on behalf of Coredale Management Ltd.

The first phase of the development will see 1,650 homes built, with 1,850 coming in phase two. The council has granted planning permission for the first phase of the development.

While the remaining land within the zoning is not part of the application proposal, councillors were told the application demonstrates how the land could be comprehensively developed as part of the entire zoning.

David Worthington of Pragma, the project's lead developer, said work on the site should begin within the next 18 months, subject to full planning approval.

"It is great news for us and it is great news for the city. It will support several hundred construction jobs over an extended period of time," he said.

"It is not a development that is going to be built overnight. The build-out is over a decade.

"There will be a high street with shops and offices and there will be other things like healthcare centres, a primary school, a church, a nursery, as well as a nursing home."

Mr Worthington said plans to develop the site had initially been put forward in 2006, but were shelved when the financial crisis occurred in 2008.

However, new owners purchased the site last year and progress is finally being made.

Mr Worthington added: "There is other non-planning legislation to be met, there are roads that need to be changed, so we have to abandon the old ones and put in the new ones, so that is the sort of thing that has to happen.

"We will try and run those things in parallel, but it is a safe bet to say work will begin within 18 months."

"The Department for Infrastructure has appointed consultants to look into plans for a four lane carriageway along the length of the Buncrana road.

"The scheme seeks to upgrade the road between Pennyburn roundabout and the border with Co Donegal at a cost of £50m."